Either way, the Return On Investment is negative. In USA , we seem to make things the rest of the world doesn't want or cannot afford because our cost structure is so much higher as our society gets more socialized. China, on the other hand, is de-socializing and they seem to be making everything everyone wants to buy.

Thats why I recommended the Chasm book. Its extremely useful explaining when a core competency becomes a context competency. The next book on the series, called "Living on the Fault Line" explains what companies need to do to continue to be the gorilla ( ie. reinventing , revitalizing , and rebooting ). To be successful, a company must provide a continuous path to innovation.

IT business is no different than any other business. Business has producers and consumers. The producers deliver a value, hopefully more value than they consume delivering their product or service. The consumers consume the value delivered by the producers. Hopefully, the consumers pay more money back than the cost of the goods or services they consume.

So for example, this is why you cannot just let developers write any code they want. If you allow developers to add all the bells and whistles they want to have, the cost of the value delivered to the business would be far too great.

A consumer is willing to pay X rupees for some product, good, or service. If it costs two times X to produce that good or service, no one would buy that.